Bloomberg ( 13 Oct 2008 )

The benchmark VN Index, a measure of 160 companies on the Ho Chi Minh City Stock Exchange, fell 7.4, or 2 percent, to 371.67, the lowest since June 23, according to Bloomberg data.

``Vietnam's growth may slow this year as a result of the global collapse. Based on fundamentals rather than sentiment, Vietnam still looks attractive.

``The domestic economy is stabilizing based on the trade deficit and inflation. The country as a whole has minimal exposure to the Western world's credit crisis. Vietnam's exports are more basic and thus less cyclical in nature, and the long- term investment commitment to Vietnam is unchanged.

``However, the ongoing financial crisis in the U.S. and other developed markets is certainly affecting investors' sentiment in Vietnam. The panic will likely continue but it will not last for too long. It won't take investors long to realize that Vietnamese companies have little direct relationship with what's happening overseas.''

On any possible intervention measures:

``I don't think the State Securities Commission should apply any measures during this decline. Market liquidity has been relatively high, hence very healthy for a frontier market like Vietnam.

``Narrowing the trading band again or a temporary trading suspension, if implemented, would be a disaster that could affect investors' confidence in the medium- and long- term. We have witnessed counter-effects of government intervention.

``Russia has closed its markets several times in the last month, only for them to plunge hugely each time they reopened them. Also, when Vietnam earlier in the year narrowed the trading band, it had a profound impact on sentiment and liquidity. As a consequence, the VN Index became the worst performing in the world in the first six months of this year.

``A better scenario for the government to improve sentiment would be to offer attractively valued privatizations of state- owned enterprises.''

On the market outlook:

``All expectations are thrown out the window at times like these. It is difficult to make any market prediction.

``We take a long-term view and see tremendous buying opportunities to accumulate good stocks, particularly those with solid management, strong balance sheets, healthy cash flows, low capital investment, especially those in the consumer sector. It is certainly a good time to invest when valuations become very cheap.''